[加拿大新聞] Ottawa may funnel health funds to provinces with more seniors government, seniors, health

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Ottawa may funnel health funds to provinces with more seniors

Read more: http://www.canada.com/life/Ottawa+funnel+health+funds+provinces+with+more+seniors/5702843/story.html#ixzz1dYQqt4UP

OTTAWA — The federal government is looking at ways to offset the disproportionate health care costs provinces with older populations will have to bear compared to their neighbours, documents obtained by the Citizen show.
An aging population is expected to be a factor contributing to rising health care costs. Some provinces, such as Quebec and those in the Maritimes, are likely to bear the brunt because there is a higher proportion of elderly people living within their borders.
“The Canadian population is aging, with some populations aging more rapidly than others,” reads a briefing note authored by officials in the federal Finance Department this year.
These and other documents were obtained under the Access to Information Act.
One proposal government officials examined would see federal money allocated based on the age of each province’s population.
The system as it currently stands provides federal funding to provinces based on their populations. It does not take into account the costs of delivering services to different age groups.
A transfer program that accounts for the ages of people living in each province would provide more money to offset costs of caring for the elderly.
Adopting a new transfer program would likely result in stiff resistance from some provinces, including Alberta and Ontario, that would receive less money if changes are made to the Canada Health Transfer (CHT) formula, which governs how much each province receives.
“Since provincial and territorial demographics differ, there would be differences in provincial/territorial CHT entitlements between a straight per capita allocation versus an age/sex adjusted per capita allocation,” the same briefing note reads.
Officials also emailed around a study from the Canadian Institute for Health Information that looked at the effect adopting the proposal would have for provinces, the documents show.
Alberta, for instance, would receive almost 10 per cent less in funding than they do now.
The federal government has no plans to tie transfers to the age and sex of provincial populations, said Jack Aubry, spokesman for the Finance Department. It continues to negotiate with finance officials on transfers.

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“This work is ongoing and no recommendations have been made,” he said.

The provinces will have to negotiate a new agreement for health transfers with the Conservative government before the current 10-year deal expires in 2014.

The provinces are solely responsible for delivering health care, but the federal government plays an essential role in providing funding. The $40 billion it will dole out this year accounts for roughly 20 cents of every dollar the provinces spend on health care.


Health care costs for provinces, meanwhile, continue to rise. The concern is that, as more and more money is spent on health, less and less will be available for other provincial responsibilities such as post-secondary education and infrastructure.

Provincial governments spent an average of $10,318 a person over the age of 65 in 2007 compared to an average of $1,966 on each person between the ages of 1 to 64, according to a November 2009 study by the Canadian Institute for Health Information.


Awarding more money to provinces who have older populations comes with the risk of discouraging innovation from the provinces, said Patrick Fafard, a federal-provincial affairs expert and political studies professor at the University of Ottawa.

Older people use the health care system more than others but they might be using it more than they need to in the form of too many tests and prescriptions.

“If you tie funding to age, you may be rewarding over-utilization as opposed to dealing with the real problem,” he said, and there would be no incentive to reduce costs.

It would, however, give provinces the money they need to pay for what is expected to be a growing expenditure in the coming years, he said.

Tying transfers to age also ignores other factors that contribute to health care costs, another study by CIHC notes. There are also costs for provinces that have a higher birth rate, given that expenditures are higher in the first year of a person’s life, and those who have a lot of people who earn less money.

Provinces are already familiar with dividing up money based on which jurisdictions need it, Fafard said. Many of them provide funding to local health care networks based on which areas have older populations.

Ottawa Citizen

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The federal government is looking at ways to offset the disproportionate health care costs provinces with older populations